Aventura & Sunny Isles Beach Luxury Real Estate

The hurrier I go the behinder I get?

Thoughts on the proposed tax laws….
I guess if you move from Venus and purchase a home as your primary residence in Florida the proposed new real estate tax law is better than nothing? Or is it? Remember, the proposed tax laws provide for a Statutory Component granting Immediate Tax Relief. Cities and counties must lower their tax rates a certain percentage based on their past taxing conduct. This component of the plan proposes $15.6 billion of tax relief over five years, with savings beginning this year. The statutory component affects all properties in a positive way, homestead, non homestead and commercial. At least that’s what it says it will do. The proposed plan is supposed to attempt to offer larger tax cuts to the counties and cities that increased taxes at a faster rate.

Do you understand a word I just wrote?
After reading several of the interpretations of possible outcomes and speaking to people in the know… the majority of which believe that this will cause more confusion and uncertainty for any real tax savings… The confusion and frustration is greater than ever. Let’s look at two examples:

You purchased your home in Oak Forest in 1991 for approx. $75 per sq. ft. that’s $250,000 for a 3400 sq ft house. Thanks to the “save our home” plan your current assessed value after 16 years is $255,000. You deduct the $25,000 homestead exemption and you pay your taxes of $4,700. (the millage rate times the assessed value after homestead exemption) If you opted for the “new super homestead exemption proposed plan” and the base value remains the assessed value, then the $255,000 would be reduced by the 75% and 15% figures or $195,000 in homestead savings. The new numbers will result in $60,000 as the base for calculation purposes. The taxes, under the same millage rate, will be only $1,245.00. or you purchased your condo in Oceania in 1991 for $340,000., approx. $152 per sq ft. Again, thanks to the “save our home” plan, your current assessed value after 16 years is $479,000. After deducting the homestead exemption your taxes are $9,600. If you opted for the “new super homestead exemption proposed plan” and the base value remains the assessed value, then the $479,000 would be reduced by the 75% and 15% figures or $195,000 in homestead savings. The new numbers will result in $284,000 as the basis for calculations and the taxes under the same millage rate will be $6,000. Where do I sign up!!! However, if the numbers are to be calculated based on market value (as outlined in your tax bill) the figures would be: The market value of the house, $714,000 would result in taxes of $10,750 and the market value of the Condo is $800,000 which would result in taxes of $12,850. Uh Oh? By the way…what about those of us that would like to down size? Or perhaps move from a house to a condo? You know that “portability” tax item that had been proposed? Where is that in any of these statutory components? I’m trying to move forward but I’m falling way behind.

The preceding is only the opinion of the writer and not intended as financial or legal advice.

You do everything correctly, market the property accurately, actually so accurately that you get a wonderful offer within 6 weeks of the listing, however the seller thinks it’s a little too low, we’re talking about an oceanfront 2 bedroom unit that is asking in the mid to upper $700’s, at the day of listing there were 23 similar units available in the SAME building, and now it’s just 6 weeks later, 46 similar units now on the market in the SAME building so you strongly suggest that the mid $700’s offer should be just tweaked… a little bit… but the Sellers know better and against your strong recommendations and the fact that you convinced the seller’s children that this was the right time to “make the deal”. The sellers know the market, know their condominium and having the last and final word decide otherwise. Needless to say THAT deal doesn’t happen. So they comfort me and remind me how I am the broker who they picked out of the seven interviewed and they know that I will produce again… and very soon, because now they are anxious. The fact that there are 35 similar sized apartments within five blocks of either side of this building now available shouldn’t have any affect on my ability to produce another “preferred buyer”. As luck, combined with creative advertising will have it… lightning did strike twice… this time the seller’s were happy to sign the deal and move forward to a smooth closing. O.k. it’s a cash deal so there’s no financing contingencies, the buyer is familiar with the building so inspections and screening are a breeze, in the meantime we secure an excellent rental for the seller’s. So now we’ve done it all… everyone is as happy as could be… the daughter flies in from Europe to help her parents with the move, the parents are in their new apartment and now we are ready to close…or so we think…The title company discovers that the association has liens… it appears that there has been work performed on the building, hurricane related, and several of the vendors have not been paid. As a legal right companies performing work on condominiums have a right to protect themselves in order to get payment by filing what are called mechanics liens. Once the vendor is paid the liens are released and everyone should be able to go on their merry way. Unfortunately if the vendors are not paid, you cannot expect the buyer to take possession of a property tha t has liens, especially ones that are clearly the seller’s responsibility. Just days before the closing the title company discovers this issue. The title company was of no help and the buyer was relying on his financial advisor. Seeing this as an opportunity, the financial advisor suggests that they renegotiate and ask for a discount in order to close. As a rule this is where having a real estate attorney involved with the transaction pays off, unfortunately, the seller’s real estate attorney was away the few days that this was happening and it became necessary for me to exercise my experience and aggressively guide the sellers along with the paralegal assigned to their file to take a firm stand. Upon the buyer’s consultation and employment of a real estate attorney at the 11th hour, recognizing that under the contract there was no basis for “any renegotiations” we are scheduled to close today… who knows? And, by the way… the funds are being wired in from California… you know that’s 3 hours earlier, however, for some strange reason, an opportunity for Western State Banks to keep the dollars just a little longer…perhaps releasing funds tomorrow?